Extended ITR deadline explained: Who can file till August 31 and who can't
Finance Minister Nirmala Sitharaman clarified this during her Budget speech, saying that only specific taxpayers would get extra time, while most individuals would continue to follow the existing deadline.
If you thought the extended August 31 income tax return (ITR) deadline announced in Budget 2026 applies to all taxpayers, that is not entirely true. The government has introduced a staggered filing timeline to reduce pressure during the peak filing season, but the benefit is limited to select categories.
Finance Minister Nirmala Sitharaman clarified this during her Budget speech, saying that only specific taxpayers would get extra time, while most individuals would continue to follow the existing deadline.
JULY 31 DEADLINE STAYS FOR MOST INDIVIDUALS
Salaried taxpayers and individuals filing ITR-1 or ITR-2 will still need to submit their returns by July 31. There is no extension for this group.
This means employees, pensioners, and individuals earning income from salary, interest, or capital gains must continue to plan their filings as before.
WHO CAN FILE ITR TILL AUGUST 31?
The August 31 deadline applies only to non-audited business cases and certain trusts. According to the Budget 2026 document and FAQs issued by the Income Tax Department, this extension is provided under Section 263(1)(c) of the Income Tax Act, 2025.
In other words, taxpayers running businesses or professions that do not require an audit, along with eligible trusts, can now file their ITR by August 31 instead of July.
WHAT ARE NON-AUDIT BUSINESS CASES?
Non-audit cases include businesses and professionals whose turnover or receipts fall below the audit threshold. These are typically small businesses, freelancers, and professionals whose turnover is below Rs 1 crore, or up to Rs 2–3 crore if they opt for presumptive taxation.
Since these taxpayers do not require their accounts to be audited, the government believes they can benefit from a slightly longer filing window.
Further, Trusts are legal entities set up for charitable, religious or private purposes, and those not requiring audits fall under the August 31 filing timeline.
WHY WAS THE DEADLINE EXTENDED?
Earlier, the due date for these taxpayers was July 31. The government has now extended it to August 31 to ease compliance, reduce last-minute rush, and allow smoother filing under the upcoming Income Tax Act framework.
WHEN DOES THIS CHANGE TAKE EFFECT?
The new deadline will apply from the tax year 2026–27. Amendments under the Income Tax Act, 2025 will come into force from April 1, 2026. Similar changes have also been made to the existing Income Tax Act, 1961, for the assessment year 2026–27.
Simply put, the said move aims to make tax compliance calmer and more manageable, without changing tax rates.
If you thought the extended August 31 income tax return (ITR) deadline announced in Budget 2026 applies to all taxpayers, that is not entirely true. The government has introduced a staggered filing timeline to reduce pressure during the peak filing season, but the benefit is limited to select categories.
Finance Minister Nirmala Sitharaman clarified this during her Budget speech, saying that only specific taxpayers would get extra time, while most individuals would continue to follow the existing deadline.
JULY 31 DEADLINE STAYS FOR MOST INDIVIDUALS
Salaried taxpayers and individuals filing ITR-1 or ITR-2 will still need to submit their returns by July 31. There is no extension for this group.
This means employees, pensioners, and individuals earning income from salary, interest, or capital gains must continue to plan their filings as before.
WHO CAN FILE ITR TILL AUGUST 31?
The August 31 deadline applies only to non-audited business cases and certain trusts. According to the Budget 2026 document and FAQs issued by the Income Tax Department, this extension is provided under Section 263(1)(c) of the Income Tax Act, 2025.
In other words, taxpayers running businesses or professions that do not require an audit, along with eligible trusts, can now file their ITR by August 31 instead of July.
WHAT ARE NON-AUDIT BUSINESS CASES?
Non-audit cases include businesses and professionals whose turnover or receipts fall below the audit threshold. These are typically small businesses, freelancers, and professionals whose turnover is below Rs 1 crore, or up to Rs 2–3 crore if they opt for presumptive taxation.
Since these taxpayers do not require their accounts to be audited, the government believes they can benefit from a slightly longer filing window.
Further, Trusts are legal entities set up for charitable, religious or private purposes, and those not requiring audits fall under the August 31 filing timeline.
WHY WAS THE DEADLINE EXTENDED?
Earlier, the due date for these taxpayers was July 31. The government has now extended it to August 31 to ease compliance, reduce last-minute rush, and allow smoother filing under the upcoming Income Tax Act framework.
WHEN DOES THIS CHANGE TAKE EFFECT?
The new deadline will apply from the tax year 2026–27. Amendments under the Income Tax Act, 2025 will come into force from April 1, 2026. Similar changes have also been made to the existing Income Tax Act, 1961, for the assessment year 2026–27.
Simply put, the said move aims to make tax compliance calmer and more manageable, without changing tax rates.